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Signing bonus for Consolidated Fund at the right time; PPP govt failed to pass CGX funds through govt accounts- Finance Minister

Last Updated on Thursday, 14 December 2017, 6:51 by Denis Chabrol

Finance Minister Winston Jordan

Finance Minister, Winston Jordan says the US$18 million signing bonus from ExxonMobil will be paid into Guyana’s Consolidated Fund whenever government decides to use the funds for the intended purpose.

“The 18 million is in a special account at the Bank of Guyana. It’s there because it’s designed for a special purpose. whenever that special purpose is activated, the monies will first go to the Consolidated Fund,” he was quoted as telling government’s Department of Public Information (DPI).

Jordan’s remarks are the clearest explanation so far since controversy erupted about the transaction several weeks ago, coming one week after he had told the National Assembly that he had no obligation to provide the information.

He explained that after the cash is deposited into the Consolidated Fund, government would go to the Parliament here (National Assembly) and get a supplementary budget to pay whoever we have to pay; whether the lawyers, map drawers, map researcher, whatever by way of consultancy services so it will pass out back through our estimates,”

The Finance Minister further informed that the foreign currency would be sold to the Bank of Guyana before it is deposited in the Consolidated Fund which would increase the Central Bank’s reserves. After that is done, he said government would seek supplementary estimates and re-purchase foreign currency to pay for the required services.

Jordan also flayed the then Bharrat Jagdeo-administration for failing to pass Canadian oil company, CGX-Energy, financial assistance through government accounts before paying lawyers. “Ours will be highlighted in our accounts. In the case of the CGX, it never entered our accounts,” he said.

Opposition Leader, Bharrat Jagdeo.

Jordan, who worked as the Finance Ministry’s Budget Director for several years when the People’s Progressive Party Civic (PPPC) was in power, said if Jagdeo’s explanation that the US$10 million were paid directly to lawyers for government and the company is correct to fight the Guyana-Suriname boundary dispute at the United Nations Tribunal on the Law of the Sea, then that transaction was irregular because it was not reflected in Guyana’s accounts.

“That 10 million dollars, regardless of whether it was paid  directly to Guyana or pay directly to the lawyers, has to come into the accounts of the government. That was never done because there is no way they can show  what we call a ‘dummy transaction’ where the money actually came in and reflected under foreign inflows and went out back in say our current expenditure under ‘other services purchased’ which means consultancy and so our accounts would have been 10 million dollars poorer and contrary to what he (Jagdeo) is stating, the accounts for those years would have been understated by 10 million US dollars,” Jordan said.

After Chartered Accountant and Attorney-at-Law, Christopher Ram first stated categorically that government had received a US$20 million signing bonus from ExxonMobil, government never admitted or gave a proper explanation about the transaction. Instead, a number of key government ministers were either not forthcoming or flatly denied the existence of a signing bonus.

That resulted in weeks of mounting criticism by Ram, the PPPC and Transparency Institute of Guyana Inc. about the lack of transparency about the deposit. It was not until Minister of Natural Resources, Raphael Trotman during last week’s National Budget debate confirmed for the first time that Guyana received a then yet undisclosed sum of money from ExxonMobil and that would be used to fund the country’s legal and diplomatic efforts to resolve the Guyana-Venezuela border controversy.

ExxonMobil’s Guyana Country Manager, Rod Henson earlier this week confirmed that the US$18 million signing bonus was deposited into a Bank of Guyana account, but said his company had no say what the money would be spent on.

President David Granger on Wednesday took full responsibility for the signing bonus, and said the deal was not disclosed because it was a matter of national security. He rubbished suggestions that government was engaging secrecy, deception or skulduggery.  At the same time, he said not all Cabinet ministers knew about the deal that dates back to September 2016. “It is a legitimate government of Guyana exercise and that I am aware that it is in the Bank of Guyana in escrow. Once it is in escrow account, it means it cannot be used for purposes for which it is no intended so as far as I am concerned, it is a legitimate Government of Guyana practice and the money has not been dishonestly acquired and will not be used for purposes for which it is not intended,” the Guyanese leader said.

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December 2017